ITR filing deadline is today – If you miss it, there are more consequences than just a penalty

• they lose the opportunity to carry forward most types of losses.
• Late filing of tax returns would also lead to delayed tax refunds.
• Failure to file even after receiving these notices can result in prosecution and even imprisonment.

The deadline to file income tax returns (ITR) for assessment year (AY) 2023-24, is today (July 31) and the Revenue Secretary Sanjay Malhotra has confirmed that the deadline will not be extended. According to a recent survey, 14% taxpayers say they will not be able to meet the deadline.

Missing the deadline can lead to various adverse consequences. Let us take a look.

You cannot carry forward most losses

The Income Tax Act provides provisions for offsetting and carrying forward losses. Offsetting involves adjusting the loss against taxable income, and any remaining loss can be carried forward to future years for set off against future incomes. These rules apply to losses under each specific income category.

If a taxpayer fails to file the Income Tax Return (ITR) within the prescribed due date as per Section 139(1), they lose the opportunity to carry forward most types of losses. However, losses under the category "Income from House Property" can still be carried forward to future years, even if the ITR is filed after the due date.

If losses are not offset against future income, the taxpayer may miss out on potential tax deductions and end up paying more taxes than necessary.

Delay in tax refunds if you are eligible

In India, taxpayers can receive a tax refund if they have paid more tax than their actual tax liability. Tax refunds are usually issued by the Income Tax Department after processing the taxpayer's income tax return (ITR).

The time frame for receiving a tax refund can vary depending on the complexity of the return, verification processes, and the efficiency of the tax authorities. Generally, taxpayers can expect to receive their tax refunds within a few weeks to a few months after filing their ITR and it being processed successfully.


Late filing of tax returns will lead to delayed tax refunds, causing financial strain. Timely filing of tax returns is essential to avoid these complications and ensure a smoother refund.

Penalty and interest on unpaid taxes

If the Income Tax Return (ITR) is not filed by the due date of 31 July, individuals can still file a belated return by 31 December, but they will be subject to a maximum penalty of ₹5,000. Additionally, interest at 1% per month or part thereof under Section 234A will be charged on taxes due until payment. It is crucial to file the belated return promptly to avoid further penalties and comply with tax regulations. The interest calculation starts from the day after the due date.

Further penalties and prosecution

If a taxpayer fails to file their Income Tax Return (ITR) by the given deadline, the income tax department can impose penalties ranging from 50% to 200% of the taxpayer's actual income tax liability. In addition to the tax and interest liability until the date of filing the ITR, the penalties will be levied in response to the income tax notice from the department.

If a taxpayer fails to file their income tax returns for an assessment year, they will receive a notice from the Income Tax Department under Section 142(1), 148, or 153A. Failure to file even after receiving these notices can result in prosecution under Section 276CC of the Income Tax Act for tax evasion.

The penalties for tax evasion exceeding ₹25 lakh include a penalty for not filing ITR and imprisonment of at least 6 months, which may extend to 7 years. For other cases, the prescribed penalty is imposed along with imprisonment of at least 3 months, which can be extended up to two years.

Other ways in which missing the deadline may hurt

While these do not fall under income tax rules, late filing of tax returns may lead to other problems.

Banks and financial institutions often require this documentation to assess your financial status and loan repayment capacity and even for travel abroad. If you miss the tax filing deadline, you may find it difficult to apply for a loan or go for your next international holiday, as tax returns are mandatory for visa applications.

Several embassies and consulates make it mandatory for applicants to submit copies of their tax returns from the previous years when applying for a visa. So filing tax returns on time is a smart thing to do.